Joint Property Owners Can Force Sale

partition-and-sale

The Partition of Property Act

 

Joint owners of property whether as joint tenants or tenants in common can force a sale of the property using the Partition of Property act.

It is common for parties to purchase properties together and register the property jointly, whether it be joint tenancy with a right of survivorship, or tenants in common with no right of survivorship. It is a fact of life that for innumerable reasons one or more parties may wish to sell the property in the future and realize their equity out of the property. This decision is often met with resisitance from the remaining ownsers who may lack the means or the will to buy out the departing owner.

Borg v Morris 2012 BCSC 554 was such a factual scenario. One co owner opposed the property sale and could not afford to buy out the other owner . He opposed the sale on the basis that it was his home, there were remaining outstanding financial issues between them, and a forced sale would involve a large mortgage prepayment penalty. Nevertheless the court ordered a sale and noted their financial isssues could be adjudicated later. The court discussed the competing equities of one owner losing his home and the other owner realizing his equity in the same home. The court found that the competing hardships were more or less equal and thus there was no good reason not to order the sale of the home, subject to an accounting. The statutory jurisdiction to order a sale of the property is found in s. 6 of the Partition of Property Act, R.S.B.C. 1996, c. 347 (the “Act”):

6. In a proceeding for partition where, if this partition of property Act had not been passed, an order for partition of property Act might have been made, and if the party or parties interested, individually or collectively, to the extent of 1/2 or upwards in the property involved request the court to direct a sale of the property and a distribution of the proceeds instead of a division of the property, the court must, unless it sees good reason to the contrary, order a sale of the property and may give directions Zimmerman v. Vega, 2011 BCSC 757, as to the correct approach under s. 6 of the Act. Mr. Justice Shabbits in that case quotes extensively from Ryser v. Rawlings, 2008 BCSC 1050 at para. 22. I would note in particular, paras. 27-29 in Ryser to the effect that the Court must order a sale of the property if requested to do so by a co-owner and that the Court’s discretion to order otherwise is a narrow one and one which is suggested would involve significant hardship.

[24] Mr. Morris’ counsel has also referred me to Sahlin v. The Nature Trust of British Columbia, Inc., 2011 BCCA 157. Mr. Justice Frankel in that case at para. 24 described the discretion to refuse a sale as broad and unfettered and that it gives the Court the ability, having regard to the particular facts and circumstances, to refuse to order a sale where a sale would not do justice between the parties.

[25] A point of disagreement between the parties concerned the onus of proving any “good reason to the contrary.” In Zimmerman at para. 25, the Court adopted a quote from Dunford v. Sale, 2007 BCSC 1422, to the effect that the onus is on the respondent in that respect. That conclusion is contradicted somewhat by the Court of Appeal in Sahlin at para. 23. It does not appear that the Court in Zimmerman had the benefit of considering this decision, since the reasons of the Court of Appeal were issued between the date of the hearing and the issuance of reasons. In any event, although the Court of Appeal stated that there is no legal onus on the respondent in this respect, the Court did adopt language from the earlier case of Bradwell v. Scott, 2000 BCCA 576, in stating:

This language is neutral in terms of onus. It is for the court to assess the evidence and to determine whether justice requires that such an order be denied. In practical terms, it would be for those opposing the application to put before the court evidence tending to establish a good reason for refusing it.

Trevor Todd

Trevor Todd is one of the province’s most esteemed estate litigation lawyers. He has spent more than 40 years helping the disinherited contest wills and transfers – and win. From his Kerrisdale office, which looks more like an eclectic art gallery than a lawyer’s office, Trevor empowers claimants and restores dignity to families across BC. He is a mentor to young entrepreneurs and an art buff who supports starving artists the world over. He has an eye for talent and a heart for giving back.

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